Greetings, and welcome to Rigel Pharmaceuticals Financial Conference Call for the First Quarter 2025. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce our first speaker, Ray Furey, Rigel's Executive Vice President, General Counsel and Corporate Secretary. Thank you, Mr. Fury. You may begin.

Welcome to our first quarter 2025 financial results and business update conference call. The financial press release for the first quarter 2025 was issued a short while ago and can be viewed along with the slides for this presentation in the News and Events section of our Investor Relations site on rigel.com. As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our plans and timing for regulatory and product development. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent annual report on Form 10-K for the year ended December 31, 2024, and subsequent filings with the SEC, including our quarter one quarterly report on Form 10-Q on file with the SEC. Any forward-looking statements are made only as of today's date, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. At this time, I would like to turn the call over to our President and Chief Executive Officer, Raul Rodriguez. Raul?

Thank you, Ray, and thank you, everyone, for joining today. Also with us today are Dave Santos, our Chief Commercial Officer; Lisa Rojkjaer, our Chief Medical Officer; and Dean Schorno, our Chief Financial Officer. Now beginning on Slide 4, we will provide an overview of Rigel's business and our results for the first quarter of 2025. I want to start the call today by highlighting our strong start to the year. Today, for the first quarter of 2025, we reported year-over-year net product sales growth of 68% from our expanding commercial portfolio. In addition, we increased collaboration revenue from our ex-U.S. marketing partners. With total revenue of $53.3 million for the quarter and continued financial discipline, we were able to generate $11.4 million in net income this quarter. Now this is a time when the general business environment is challenging, especially for the biotech market, but highlights the robustness of our corporate strategy and consequently, our unique position. Rigel is a growing, profitable company with important clinical opportunities at hand that we are able to fund ourselves. On this call, the team will provide you with greater details on our position and this quarter's results. Dave will provide an overview, update on the strength of our growing commercial business that now includes 3 commercial products after the acquisition of our latest product, GAVRETO. Lisa will provide updates on the advancement of our development pipeline, including R289, our novel and selective dual IRAK1 and 4 inhibitor. R289 is currently being evaluated in a Phase Ib clinical study in patients with relapsed or refractory lower-risk MDS. She will also highlight our plans to expand olutasidenib in the planned -- with the planned initiation of a Phase II study in recurrent glioma. Beyond these Rigel-led development programs, we also remain committed to evaluating…

Thank you, Raul. On Slide 6, you'll see our 3 commercial products, TAVALISSE, GAVRETO and REZLIDHIA. Moving to Slide 7. We are pleased with the strong year-over-year growth in revenues in the first quarter of 2025. You can see how our quarterly and annual sales have increased since 2021 in the chart. We have grown each quarter sales over the previous year, and that growth continues. In the first quarter of 2024, we reported $26 million. And now for the first quarter of 2025, we generated $43.6 million, representing a 68% increase. Our year-over-year growth was driven by the addition of GAVRETO to our portfolio last year, as well as growth in both TAVALISSE and REZLIDHIA. Our commercial team has been dedicated to execution, driving continued momentum for TAVALISSE, raising awareness for GAVRETO after a successful transition into our portfolio and improving both institutional and community demand for REZLIDHIA. My sincere thanks to the entire team for all their hard work. Slide 8 shows a summary of our commercial performance by product. First, on TAVALISSE. I'm pleased to report another strong quarter in which we generated $28.5 million in net product sales, an increase of 35% compared to the first quarter of 2024. This growth was driven by continued strong patient demand with another consecutive quarterly record high. For GAVRETO, we delivered $9 million in net product sales in Q1. As a reminder, GAVRETO became commercially available from Rigel in late June 2024. And lastly, for REZLIDHIA, we reported $6.1 million in net product sales, an increase of 25% compared to the prior year period. Moving to Slide 9. I'll provide more color on our commercial performance. TAVALISSE continues to grow steadily as the foundation of our portfolio, consistently hitting new record quarterly highs in patient demand. That steady growth…

Thanks, Dave. I will now provide an overview of our pipeline progress and plans for the remainder of the year. I'm on Slide 12. From our development pipeline, we're particularly excited by the progress in the clinical development of R289, our novel dual IRAK1 and IRAK4 inhibitor in lower-risk myelodysplastic syndrome, or MDS, and olutasidenib in mutant IDH1 recurrent glioma. Beginning with R289, our Phase Ib study in patients with relapsed/refractory lower-risk MDS is progressing well, and we're currently enrolling dose level 6. We look forward to providing updated data from this study in the second half of this year. From a regulatory perspective, the granting of both Fast Track designation for the treatment of patients with previously treated transfusion-dependent lower-risk MDS and Orphan Drug designation for MDS is an acknowledgment by the FDA of both the unmet medical need of the lower-risk MDS patient population and the potential of R289. Furthermore, as part of Rigel-sponsored development programs and alongside our partners, MD Anderson and the Connect Cancer Consortium, olutasidenib is being evaluated in new indications. We believe olutasidenib has potential in several cancers where mutated IDH1 plays a role, such as glioma, additional AML segments and MDS, either as monotherapy or in combination. We expect to initiate a Rigel-sponsored Phase II study to evaluate olutasidenib in recurrent glioma later this year. In addition, all 4 clinical trials under our MD Anderson collaboration are now open for enrollment as is the CONNECT TarGeT-D study, evaluating the combination of olutasidenib with temozolomide as maintenance therapy in adolescents and young adults with IDH1 mutated high-grade glioma. Consistent with our strategy and evidenced by our acquisitions of olutasidenib and pralsetinib, we remain focused on evaluating potential opportunities to expand our portfolio by in-licensing or acquiring products that would be a strategic fit for…

Thank you, Lisa. I'm on Slide number 28. We reported net product sales of $43.6 million for the first quarter, growth of 68% year-over-year, including TAVALISSE net product sales of $28.5 million, a growth of 35% year-over-year, GAVRETO net product sales of $9 million. As a reminder, GAVRETO became available from Rigel in June of 2024, and we reported REZLIDHIA net product sales of $6.1 million, a growth of 25% year-over-year. Our net product sales from TAVALISSE, GAVRETO and REZLIDHIA were recorded net of estimated discounts, chargebacks, rebates, returns, co-pay assistance and other allowances of $16.6 million. As anticipated, we saw a sequential decrease in net product sales from the fourth quarter of 2024. Consistent with our remarks on our fourth quarter earnings call and what we've seen in past first quarters, our revenues were impacted by a drawdown in inventory levels across our distribution channels. We also reported $9.8 million in contract revenues from our collaborators for the first quarter, primarily driven by contributions from Grifols, Kissei, which included the $3 million milestone payment and Medison, bringing our total revenues for the first quarter to $53.3 million. Finally, I'd like to take a moment to discuss the reporting impact from our notification to Lilly that we will not exercise our opt-in right related to the development and commercialization of olutasidenib for the treatment of non-CNS diseases. As a result of this notification, in the second quarter, we expect to recognize approximately $40 million in collaboration revenue. This is noncash and related to the release of the remaining cost share liability currently on our balance sheet. Under the terms of our collaboration agreement, Rigel will continue to be entitled to receive milestone and tiered royalty payments on future net sales. Moving on to the next slide and down the income…

Thank you, Dean. Moving on to Slide 30. We made significant strides over the past 3 years to expand our commercial portfolio via in-licensing or acquiring assets that fit our commercial capabilities and portfolio focus. We have a proven track record of delivering top line growth as evidenced by the 32% compound annual growth rate or CAGR in revenue growth from 2021 to 2024. This revenue growth enables us to fund our business and our strategic priorities, including to continue expanding our hematology and oncology business. And we're confident in our expectation of approximately $185 million to $192 million in net product sales this year. Turning to Slide 31. For the remainder of 2025, our priorities are clear, grow our commercial business, advance our development pipeline, identify new pipeline opportunities and continue to maintain financial discipline. We anticipate growing our net product sales in 2025 by approximately 30% year-over-year. We remain focused on advancing our Phase Ib clinical study evaluating R289 for the treatment of patients with lower-risk MDS. And we are on track to publish updated data at a medical meeting late this year and initiate the dose expansion phase of this study by year-end. For olutasidenib, we plan to initiate a new Rigel-sponsored Phase II study in recurrent glioma while continuing to support our strategic collaborations with both MD Anderson and the CONNECT organization. With our anticipated strong revenue growth, financial discipline in 2025, we will continue to invest in our development programs, but also expect to report positive net income for the full year. Finally, on Slide 32, our successful execution of our corporate strategy has resulted in Rigel being uniquely positioned in building a leading hematology and oncology business in a profitable and sustainable manner. And with that, I'd like to thank you for your interest, and we will now open the call to your questions. Operator?

Thank you. [Operator Instructions] And our first question comes from Kalpit Patel with B. Riley Securities. Please state your question.

Hey, good afternoon and thanks for taking the question. I had one on the TarGeT-D program that you have ongoing in high-grade glioma. I guess you have two different plans here for glioma. You have that study running and then you also have the planned company-sponsored Phase II trial in recurrent glioma. Can you help us clarify the objectives and perhaps the design differences between the two? And longer term, what signal do you want to see in the TarGeT-D program to justify moving forward in one program or the other?

I'll ask Lisa to take a shot at it. And also, I think just to start that there's two different studies here, two different patient populations. The TarGeT-D program, which we're delighted. It's an umbrella study that was already underway, which allows us to add our product to that one. So logistically facilitates the start and initiation of that study. It's a bit different population than what we're contemplating in our own clinical study. Maybe you can just give ore color, Lisa.

Yeah, sure. Thanks for the question, Kalpit. So yes, as Raul mentioned, we're supporting this - the CONNECT umbrella study. Our arm is looking at the combination of, as I mentioned, olutasidenib with temozolomide as maintenance. So in the maintenance setting. So these will be targeting patients that are post surgery and radiotherapy. So it's temozolomide, olutasidenib for 1 year, followed by 1 more year of olutasidenib monotherapy maintenance. And this is going to be focused on patients with Grade 3 astrocytoma, so looking for an impact on progression-free survival. We're happy to be working with CONNECT on this one. It's a unique population. These are adolescents and young adults. We're looking to kind of help expand that site - the sites also because they're a pediatric organization potentially into more adult sites. And we think it complements our strategy nicely with our plans to go into recurrent glioma. Now we're not discussing any of the details about our plans yet, but we will be sharing more about that later on in the year.

Okay. Wonderful. And then one quick question on the patent litigation that you resolved with Annora for TAVALISSE. I guess, are there any other ANDA filers that investors need to be aware of?

No. There's no ANDA filers that we are aware of.

Okay. Got it. Thank you very much for answering questions.

Thank you, Kalpit.

And your next question comes from Joe Pantginis with H.C. Wainwright. Please state your question.

Hi. Good afternoon. Thanks for taking the question. So first, when you're looking at your product sales, and it's nice to see your core revenue from TAVALISSE continuing to expand. GAVRETO increased, you saw some - a little bit of increase or from REZLIDHIA, a little bit down from TAVALISSE. So I guess any commentary with regard to typical first quarter resets? Are you seeing what you expected? And what I'm getting at here is the turbulence in the environment right now and I'll put in quotes drama around people trying to understand what might be happening with regard to Medicare changes as well.

Yes. Why don't - Dave, maybe you can comment, and I know Dean has a comment on that as well.

Sure. Thanks for the question, Joe. Actually, for Q1, we are quite pleased with our progress on all 3 brands. We grew demand for all 3 brands. And so I think we're right where we want to be, which is why we're sticking with our guidance. And I think our signs for Q1, obviously, we did go into it kind of prepared for the changes, particularly with respect to the Inflation Reduction Act. And I think we did a really - the team did a terrific job making sure that patients understood the changes and all of the factors that would enable them to have medications in - at the beginning of the year. And I think we pulled that through quite successfully and our demand continued to grow.

Yes. I think Dave has that right. So we're pleased with the demand side of the equation, and we did see the expected drawdown in inventory, resulting in still a 68% year-over-year growth. So a strong quarter for us.

All right. Thanks for the info.

Thank you, Joe.

[Operator Instructions] And your next question comes from Farzin Haque with Jefferies. Please state your question.

Hi. Thank you for taking my question. I had a couple. I guess I'll start with R289. Are you saying more on how you're setting expectations for the split doses that you're exploring post ASH, like with the dose level 5 and 6? And then just to clarify, for advancing to the recommended Phase II dose, would you need regulatory feedback on dose escalation data set?

Yes, I'll let ask Lisa to comment on that.

Yes. Thank you for the question. So in terms of -- we don't really have any expectations. I'm not sure I understand question. We have switched -- I'll provide an answer, and you can tell me if I've answered it satisfactorily. We switched some time ago from once daily to twice daily dosing because we thought that biologically, it makes more sense to maintain a tonic suppression of inflammation as opposed to having this once daily like peak and trough and peak and trough in terms of - from that aspect. And that's why we switched to explore the BID dosing. We're progressing up. We had some preliminary data on the 250 BID. We've now completed enrollment of the 500, 250 and now into the 500 BID. So as I mentioned, we're going to be updating data at ASH, share that with you later on this year. I think we'll share some PK data as well that I think will contribute to what I mentioned in terms of it may be better to kind of have that more prolonged exposure as opposed to the up and down. With respect to the - you mentioned the alignment or how to select the doses. So as you're aware, the FDA has encouraged companies now to align with Project Optimus to ensure more robust dose selection early before advancing into Phase II. So consistent with that, we will be seeking input from the FDA, aligning with them on the 2 doses for comparison in the dose escalation part of the study, and we'll be doing that midyear.

Got it. That makes sense. And then for a follow-up on the earlier question on the ANDA filing. So Annora is one example, and they cannot enter the market, I think it mentioned prior to 2Q '32. But if there are additional ANDA filers in the future, could they have an earlier market entry? Or is that 2Q '32 pretty much when you should see a new entry?

Yes, you can get second ANDA filers, and they would need to defeat the patents, which in order to enter the market earlier than the current last list of patent, which would be July 27, 2032. But there's a possibility of an ANDA filer. But once there's one entrant already where there's a settlement, it's a disincentive to second filers and tertiary filers. But it is technically possible that there could be a second fire. We haven't seen yet. No, we have not -- there's no -- we have no notice of a second filers.

Okay. Thank you.

And there are no further questions at this time. I would like to turn the floor back over to Mr. Raul Rodriguez for closing comments. Thank you.

Thank you. I'd like to thank everyone for joining us on the call today. It was the start of a very strong year. First quarter was an excellent quarter for us. We're very happy with what we were able to accomplish in this quarter. It sets us up very well for a very strong calendar year. And so for that, I'd like to thank you for your continued interest in Rigel. I'd like to also thank our employees and for their commitment to Rigel and our values, particularly our commitment to improving the lives of patients. We will keep you updated on future calls as the year progresses. And with that, have a good day.

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.+